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February 2003 Hot Topic
Enter Resource Reengineering…the
Key to
the Best Cost Enterprise
Are we through with reengineering?
Not hardly…and not ever! A basic idea of process reengineering
is to start with a clean sheet of paper and look at how a
specific result can be achieved given all available means of
achieving that result. As a simple example, a company might have
a work process that was designed in 1995 based on the means and
technologies available at that time. Now in 2003, a blank sheet
of paper approach would allow consideration of new means and
technologies that have become available since 1995. And since
there will be no end to technological innovation, frequent
reengineer approaches need to be taken…especially after such
innovations.
In many reengineering projects
conducted to date, process has been the primary focus with
additional focus on how the processes might be resourced. In
many such efforts the emergence of new technologies including
Information Technology was the driving force to achieve better
process performance. Technology breakthrough…process
reengineering needed to take advantage of that new technology.
Resource
Reengineering is clean sheet redesign with
primary emphasis on resources for processes, followed by process
changes as needed to take advantage of different resources.
The end goal of Enterprise
Resource Reengineering is to enable an enterprise with a
competitive edge based on cost.
While all kinds of resources must
be considered in Resource Reengineering, a key resource for
consideration will be people. In other words, when there is a
breakthrough in resources (including the ability to access
then), Resource Reengineering
is called for to achieve maximum process performance at the
lowest cost.
A highly-visible example of a
resource breakthrough is the availability of computer
programming resources from India…people as talented as US
personnel, operating in companies that are highly credentialed
(i.e., SEI Capability Maturity level 5 shops)…able to connect
through the internet, offsetting time zones (they work while the
US sleeps)…and most important, economics that are more than 60%
lower than US resources.
But haven’t companies been taking
advantage of these kinds of resources for decades? The answer is
clearly Yes and No. Yes, companies have taken advantage of the
best-cost resources for what might be called simple
manufacturing work that is directed or patterned from here. No,
companies have not yet taken full advantage of the knowledge
workers that are now available across the globe. Knowledge
workers are capable of not only delivering a product or service,
but self-designing products/services as well as
self-management. .
So what’s the
bottom line? First,
plan to do a reengineering analysis on your work processes after
the emergence of technological breakthroughs…there may now be a
better way. Second, and equally important, plan to do a resource
reengineering analysis whenever there are breakthroughs in
resource supply/availability.
And the
bottom, bottom line
is that most companies have already made a pass at reengineering
processes…but they have not as yet made a formal pass at
Resource Reengineering. But now is the time …companies selling
their goods and services in global markets must use those same
global markets for their resources. And companies must make that
Resource Reengineering analysis across the entire enterprise
(not just Information Technology because that is the hot thing).
If they don’t, many companies will continue to find that their
costs won’t allow a profit in this era of global business.
By: Dutch Holland
 Dutch Holland,
CEO of HDI, has worked as a management consultant for 30 years,
helping organizations and leaders manage and implement change
successfully. And if you enjoyed this short article, you'll
love his book, Red Zone Management: Changing the Rules
for Pivotal Times (Dearborn Trade, Chicago, Fall 2001).
Check your local bookstores or read a review at amazon.com
or barnesandnoble.com!
Contact Dutch at 713.877.8130.
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